The first initial public offering (IPO) of the new calendar year is set to make waves on Dalal Street as Jyoti CNC Automation gears up for its IPO launch on January 9, aiming to raise up to Rs 1,000 crore. This IPO marks a significant event as the company plans to introduce only a fresh issue without any offer-for-sale component.
Key Highlights
- Jyoti CNC Automation’s IPO is set for Jan 9 and aims to raise a significant Rs 1,000 Cr with a fresh issue.
- Unique focus: The IPO comprises only a fresh issue, eliminating any offer-for-sale component.
- Diverse investor participation: Allocation includes 75% for institutional buyers, 15% for high net-worth individuals, and 10% for retail investors.
- Strategic fund allocation: Rs 475 Cr for debt repayment, Rs 360 Cr for long-term working capital, and the remainder for general corporate purposes.
- Robust market presence: As the third-largest CNC machines manufacturer in India, Jyoti CNC holds a 10% market share in FY23.
- Strong financial turnaround: Profit of Rs 15.06 Cr in FY23, marking a significant shift from the Rs 48.3 Cr loss the previous year.
- Sector diversity: Jyoti CNC serves aerospace, defence, and medical sectors, including notable clients like ISRO, BrahMos Aerospace, and Tata Advanced System.
Jyoti CNC Automation IPO Date
The public issue is scheduled to conclude on January 11, with the anchor book set to open on January 8. For its dedicated employees, Jyoti CNC Automation has reserved shares worth Rs 5 crore. The IPO, excluding the employee portion, constitutes the net issue.
Jyoti CNC Automation Issue Size: Allocation and Utilization of Funds
Approximately 75 percent of the net issue size has been reserved for qualified institutional buyers, 15 percent for high net-worth individuals, and the remaining 10 percent for retail investors. The net fresh issue proceeds will see Rs 475 crore utilized for debt repayment, Rs 360 crore for long-term working capital requirements, and the remaining funds allocated for general corporate purposes.
About Jyoti CNC Automation
It is the leading global CNC machine manufacturer, ranking second in India and twelfth globally. In 2022, the company held the second-largest market share in India at around 8%. Specialising in simultaneous 5-axis CNC machines, CNC Automation offers a diverse range, including CNC Turning Centers, Vertical and Horizontal Machining Centers, and multi-tasking machines. With over two decades of experience and robust R&D, it caters to various industries like aerospace, defence, automotive, general engineering, EMS, dies, moulds, and more, providing tailored solutions to our customers.
Jyoti CNC Automation IPO Price Band
The price band for the IPO is yet to be officially announced, creating a buzz among investors and market enthusiasts.
Allotment Reservations
For the benefit of its dedicated employees, Jyoti CNC Automation has reserved shares worth Rs 5 crore, underlining the company’s commitment to its workforce. The IPO, excluding the employee portion, represents the net issue available for public subscription.
Market Presence and Clientele
As the third-largest market shareholder in metal-cutting CNC machines manufacturing in India, the company holds around 10 percent of the market share as of FY23. Jyoti CNC Automation serves various sectors, including aerospace, defense, and medical, with notable clients such as ISRO, BrahMos Aerospace, Tata Advanced System, and more.
Financial Snapshot and Operations
As of September 2023, the company boasts an order book of Rs 3,315.33 crore. Jyoti CNC Automation operates through three manufacturing facilities in Gujarat and Strasbourg, France, with a combined manufacturing capacity of 4,400 machines per annum in India.
Ownership and Financial Performance
Promoters currently hold a 72.13 percent stake in the company, with the remaining owned by public shareholders. Notably, Jyoti CNC Automation turned profitable in FY23, reporting a net profit of Rs 15.06 crore compared to a loss of Rs 48.3 crore the previous year. In the six months ending September FY24, the company recorded a net profit of Rs 3.35 crore on a revenue of Rs 509.8 crore.
Merchant Bankers
Equirus Capital, ICICI Securities, and SBI Capital Markets are appointed as the merchant bankers for this IPO, reflecting the confidence in the offering. Investors and market enthusiasts are keeping a close eye on Jyoti CNC Automation’s IPO, anticipating its impact on the financial landscape.
Conclusion
The Jyoti CNC Automation IPO presents a compelling investment opportunity for Indian investors. With a strong market position, strategic fund allocation, and a diverse clientele, the IPO signals potential growth. The company’s financial turnaround and sector diversity add to its attractiveness, making it an opportunity worth considering for investors looking for long-term gains in the CNC machine industry.
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Disclaimer: Investments in the securities market are subject to market risks; read all the related documents carefully before investing.